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Ellen, Attorney
Category: Bankruptcy Law
Satisfied Customers: 36714
Experience:  Bankruptcy Lawyer. Experienced.
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Hi, I live in Wisconsin. If I file a chapter 13 bankruptcy

Resolved Question:

Hi, I live in Wisconsin. If I file a chapter 13 bankruptcy repayment, go to court and have payments taken out of my paycheck for the next three years, right? My question is what happens after the chapter 13 is in effect and they're garnishing my wages and lets say 2 months into it i get a $20,000 severence check from my old employer. Or, if my spouse dies and I recieve a life insurance check? What happens to that money? Would my attorney or the court even know i got this money? Is there a way for me to keep whatever I get since the repayment plan is already in effect and current?
Submitted: 4 years ago.
Category: Bankruptcy Law
Expert:  Ellen replied 4 years ago.
Welcome to JustAnswer,

So sorry to hear of this dilemma. If my answer is not clear to you, please ask me for clarification by using the reply button.

In short you may have to pay the money into the plan if you are in less than 100% plan. Here is why.

Chapter 13 plans must pay 100% or pay all disposable income for at least three years after the date of the first payment under the plan.If your plan is at 100% you can pay off your plan early. If not, your proceeds will need to be paid into the plan in addition to the amount stated in the plan.

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Please let me know if you have any questions concerning my answer.
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Customer: replied 4 years ago.
how would my attorney or the court know if i ever recieved this money?
Expert:  Ellen replied 4 years ago.

I am not aware of any automatic reporting to the trustee or to your attorney.